Breaking News: Minimum Wage Increase Announced - 13/05/2009

The Government has today announced that, from 1 October 2009, the adult minimum wage rate will increase from £5.73 to £5.80 an hour. At the same time the Youth Development Rate will rise from £4.77 to £4.83 an hour and the minimum wage for 16-17 year olds will increase from £3.53 to £3.57 an hour.

The Chairman of the Low Pay Commission, George Bain, said:

"These are very challenging times for the UK and unprecedented economic circumstances for the minimum wage. We believe that the Low Pay Commission's recommendations are appropriate for this economic climate. They reflect the need to protect low-paid workers' jobs as well as their earnings.

"This was a difficult year for the Commission but our evidence-based approach led to another unanimous Report. I am delighted that the Government has again accepted our recommendations on the rates this year.

"The Commission made a number of other recommendations in its Report, including on apprentice pay and enforcement. We believe there is a strong case for paying apprentices an apprentice minimum wage under the National Minimum Wage framework. We look forward to hearing the Government's position on apprentice pay in our remit for the 2010 Report.

"Finally, we are pleased that the Government has now accepted our recommendation that 21 year olds should be entitled to the adult rate of the minimum wage. We have long believed that 21 was the appropriate age from which the adult rate should apply."

Business groups such as the British Chamber of Commerce (BCC) had earlier this year argued for a freeze on minimum wage increases to protect jobs and businesses during the recession.

David Frost, Director General of the British Chambers of Commerce (BCC), commented on the increase:

"We pressed for a freeze to the minimum wage because of the severity of the downturn and the daily loss of jobs. We are pleased that the increase is only a modest one, and it shows that the Low Pay Commission and the Government have largely understood the seriousness of the situation. However, a freeze in the NMW would have been more help to business."

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